With everything getting more expensive lately, it’s no surprise if you're wondering if now is the right time to buy a home. Inflation has been higher than usual for longer than expected, driving up the costs of just about everything. But here's the good news: homeownership can actually be one of the best ways to protect yourself from the rising costs inflation brings.

A Fixed Mortgage Shields You from Rising Housing Costs

One of the biggest advantages of owning a home is the stability it provides for your biggest monthly expense—your mortgage. When you lock in a fixed-rate mortgage, your principal and interest payments remain the same, no matter how high inflation gets. While your homeowner’s insurance or property taxes may fluctuate slightly, your mortgage payment won’t change.

Renters, on the other hand, face rising rent prices year after year, often at a pace faster than inflation. According to data from the Bureau of Economic Analysis and the Census Bureau, rent increases tend to outpace inflation. So, while homeowners with a fixed-rate mortgage enjoy predictable payments, renters are stuck paying higher amounts over time, making it harder to budget.

Home Prices Tend to Outpace Inflation

Another reason homeownership is a solid defense against inflation is that home values generally increase over time, often at a rate higher than inflation. Real estate has historically been one of the most reliable long-term investments, even during periods of rising prices. Unlike cash savings, which lose value due to inflation, real estate tends to hold its value or even grow, helping you build wealth.

Renting, however, offers no protection from inflation. When inflation rises, landlords usually pass those extra costs on to tenants by increasing rent. As a renter, you end up paying more without building any equity. But as a homeowner, your property’s value increases, and you’re building equity with each mortgage payment.

With experts predicting home prices will continue to rise, buying now means you're investing in something that should grow in value and outpace inflation in the future.

Bottom Line

While inflation may make everyday expenses feel unpredictable, owning a home provides stability. Your mortgage payment stays relatively stable, unlike rent, and the value of your home is likely to appreciate over time.

How would having a fixed mortgage payment change the way you plan and budget for the future?